The Choice has invited Marie Bigham, a former college admissions officer and veteran college counselor, and
Mark Kantrowitz, a financial aid expert, to answer your questions about comparing financial aid offers and deciding where to enroll in the blog’s virtual Guidance Office, a forum for college applicants and their families seeking expert advice.

The moderated Q. and A. session, which began Monday, will continue throughout the week.

In this second installment of answers, the panelists respond to questions about choosing between a private university and a more affordable state school, and the value of universities that are not in the Ivy League.

Some questions and answers have been edited for length and style. — Tanya Abrams

Private University vs. State Institution

Q.

My son’s top choice happens to be the most expensive (private) school. Even though it has the best offer of aid, the out-of-pocket cost would still be $40,000 to $45,000 a year. As a middle-class mother (not rich, not poor), how do we compare that with a state school where the overall cost would be $25,000 a year? I think the experience, education and connections would be superior at the expensive private school, and my son would be more likely to graduate in four years. But is it worth $80,000 more over four years?

— CA mom

Q.

I got into New York University, but even with a Pell Grant and scholarships, I would still have to pay around $36,000 a year. Most likely, I would have to take out loans. I could take a gamble and enter N.Y.U. and search for scholarships, or I could attend a University of California school back home that costs excessively less. I got into the nursing school at N.Y.U. My only problem is that at the University of California at Santa Barbara, there are no nursing courses. However, at N.Y.U., I could go directly into its five-year program. I also don’t want to be in so much debt.

— Deeza

“Do you want to still be repaying your own student loans when your children enroll in college?”

— Mark Kantrowitz

A.

Mr. Kantrowitz: The colleges that offer the most financial aid aren’t necessarily the least expensive ones. When evaluating college costs, consider the net price, which is the amount of money you will have to pay from savings, income and loans.

Also consider how much you will need to borrow. Total student loan debt at graduation should be less than the borrower’s expected annual starting salary, and ideally a lot less. If total debt is less than annual income, the borrower will be able to repay the student loans in 10 years or less.

Generally, taking on an additional $80,000 in student loan debt to attend your dream school is not worth it. If you graduate with too much debt, you may feel compelled to take the job that pays the most instead of the job that is the best fit for your career plans. Students with a lot of debt often delay life-cycle events like buying a car, getting married, buying a house, having children, saving for retirement and saving for their children’s college educations. Do you want to still be repaying your own student loans when your children enroll in college?

While it may take an additional year to graduate from the in-state public college, the total cost of the education will still be much less than at a private college that charges an extra $20,000 or more a year. You could buy a nice car as a graduation present and still come out ahead financially.

While the total dollar return on investment is greatest at the most selective colleges, these colleges also cost much more. The highest rate of return on investment is at the in-state public colleges. These institutions can also offer a high-quality education. After all, most of the Ph.D. students who graduate from the Ivy League have to go somewhere else to teach.

Don’t count on scholarships to make up the difference. Only about one in eight students win private scholarships, and the average amount used per year is about $2,800.

Ms. Bigham: Mr. Kantrowitz has covered the financial aspect beautifully, so I’ll add only two points. First, when calculating potential costs, take into consideration the time it will take to graduate. Because of reduced financing and faculty hiring, some public colleges are struggling to graduate students in four years. Some now talk about graduation rates in terms of six years.

Second, I’m not against students taking out some loans to pay for college. A recent study showed that students with some financial commitment to the cost of college tended to perform better in the classroom than students whose parents paid the full freight.

But heed Mr. Kantrowitz’s advice about the appropriate amount of debt. I paid off my student loans not long ago — many, many years after graduation. I actually cried when I made that final payment. Honestly, I was more emotional about paying off the loans than I was when I graduated!

Are Non-Ivies Worth the Cost?

Q.

I was going to write about our terrible circumstances regarding my boys’ father’s terminal illness, hence his loss of job, income, etc., which is not easily conveyed in a fill-in-the-blank financial aid application. But now I read the comment saying, “Go Ivy or go state,” which only adds to the confusion. It feels as though we are all in this vortex with the ridiculous costs, and with no way of knowing the outcome. Is a private college only worth the money if it is Ivy? And are Boston College, Wake Forest and N.Y.U. considered to be not so worth it?

— Buffyelton

“Quality is not concentrated in one famous athletic conference.”

— Marie Bigham

A.

Ms. Bigham: Many of the questions posed to us here are about value — this major versus that major, this college versus that college, this cost versus that cost. In short, you define value. Here are some things to consider:

What you can reasonably afford. Be upfront with your student if cost is a major factor. Talk to the financial aid office: some families at my school have discovered that, with financial aid, some private colleges are less expensive than in-state public colleges.

Have an open mind about your major. We don’t necessarily know what jobs will be hot, available or obsolete in the near future. Several surveys show that employers seek qualities like collaboration, critical thinking and problem-solving ability. These skills are honed in most college majors. Ask prospective colleges what their students do after graduation, and with what majors.

Assess your learning style. If a college does not provide the qualities necessary for students’ success — class size, major availability, learning services — chances are they won’t be as successful as they could be, and your investment will yield less.

I would flip your question from “Is it only worth the money if it is Ivy?” to “Is Ivy worth more than any other college?”

Quality higher education can be found far and wide in the United States. It is one of the things we do best in the world, as evidenced by the large number of international students who apply to our colleges.

Quality is not concentrated in one famous athletic conference. Wake Forest, one of the colleges in your question, has been praised for how it approaches career counseling and job searches. It now offers courses for credit like Personal Framework for Career Exploration, Strategic Job Search Processes, and Professional and Life Skills. If job opportunities and career development are important to you and your student, then I’d say that Wake Forest reflects your values and could be very “worth it” in the long run.

Mr. Kantrowitz: The Free Application for Federal Student Aid does not ask about unusual financial circumstances. Instead, Congress gave college financial aid administrators the authority to adjust the data elements on the application to compensate for the effects of unusual family circumstances.

For example, if a primary wage-earner has had to quit his or her job because of a terminal illness, the colleges can substitute an estimate of income during the award year for the previous year’s actual income figures. Provide financial aid administrators with documentation of the extenuating circumstances, like copies of unreimbursed medical bills and a letter from a doctor regarding the terminal illness.

Ivy League institutions have adopted generous “no loans” financial aid policies. These policies replace loans with grants, yielding a much lower net price than at other colleges. The net price is often in the same ballpark as an in-state public college. Bachelor’s degree recipients at Princeton University, the college that started the trend, graduate with an average of about $7,000 in debt.

All of the colleges you listed are high-quality institutions, as are the in-state public colleges. Everything else is marketing. So it is often best to pick a college with one of the lowest net costs, so long as it offers the majors that are of interest to the student. In-state public colleges and the no-loans institutions usually have the lowest net prices.

With a soon to be freshman in college, I have so enjoyed these columns. We had a very frank chat with our daughter and asked her what she thought would be a reasonable amount of student debt she could reasonably carry upon graduation. She thought for a few moments and said $80,000.00. We nearly fell off our chairs. We explained to her the consequences of debt, talked about starting salaries, expenses, and loan payments. She then spent hours researching colleges and universities with generous financial aid based on grants and scholarships, and came up with a spreadsheet of 10, including state and private.
She was accepted to both state and private schools and choose Wesleyan based on the fantastic scholarship and grants package, unmatched by our flagship state university.
Our lesson? Be frank about expenses- include after graduation budgets and show how loan payments can adversely impact their lifestyle- have your child do research, and don’t discount private universities!

My son got into Honors programs of all 7 schools he got accepted to being Upenn as the only ivy then UVA, Lehigh, Miami, Pitt, Maryland and Rutgers. We narrowed to Upenn UVA and Rutgers in which it will be $62k per yr for Upenn, $52k per year for UVA and free with full scholarship to Rutgers. I just can’t justify paying $248k more for a bs or vs at Upenn when he can go to Rutgers and we will have all that money for a top graduate school. Any advice?

Kids (and some parents) do not understand that large debt is an albatross around their necks–it limits when and whether you can go to grad school, what job you can take, where you live, even when you can have children. Our daughter was admitted to a prestigious medical school, but chose to attend a very strong (but not big name) state medical school. Same education, but a difference of $180,000 in debt. It was a no-brainer. She would have preferred the big-name school in the city, but that’s life, and financial reality.

To Tom — is Penn a quarter of a million dollars better than the honors program at Rutgers? I don’t even think the folks at Penn would argue that.

Penn is a great school, but with a full scholarship to Rutgers, I’d say go with Rutgers! I know sometimes kids have their hearts set on certain schools, but it ultimately comes down to making a sound financial decision, regardless of whether you can just write a check for the tuition or finance it through loans.
We told our daughter that 20 grand was all she could come out with for undergraduate loans. And with all things being equal, she’ll come out owing much less. That is our gift to her-a solid foundation to build on, a fabulous education, almost debt free.

I do no envy seniors and their parents at this time of the year. I do tell them in the beginning that the likely outcome will involve a lot of compromising all the way round but, in the end, students need to understand that they should “bloom where they are planted.”

I do agree that having a frank discussion with your children is one the best strategies in planning for college education. The sad reality always hover us but we must also be resourceful. I’ve seen a $500 scholarship contest at schoolgrantsblog which my daughter joined- not much but could be helpful.

How do we calculate “Expected family contribution”? We can contribute the same amount we pay to have our child at home with us, but no extra. But what is that amount? How can we figure out how much it costs to have person at home? I can get as far as dividing our grocery bill by number of eaters and determine what it costs to feed her, but then…? I looked–I cannot find a calculator online.

Shannon: “Expected family contribution” aka “EFC” is normally calculated by a college after a FAFSA has been filled out and financial aid application made. My EFC was calculated after the FAFSA was completed and was not something I calculated by myself or found on some website’s calculator.